Figure 4-9
Moonshine" is illegal home brew made by adding sugar to accelerate corn fermentation. Ten pounds of sugar are necessary to make a gallon of moonshine. In the mid-1970s, the price of sugar tripled and the price of moonshine skyrocketed from $6 to $15 a gallon. Which graph in Figure 4-9 best illustrates this?
a.
1
b.
2
c.
3
d.
4
d
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The cost to a firm of producing one more unit of output
A) usually exceeds the firm's price. B) is significantly less than the firm's price for purely competitive firms operating in long-run equilibrium. C) usually equals the firm's price for monopolistically competitive firms. D) is the firm's marginal cost.
A decrease in U.S. tariffs on European goods, ceteris paribus, would ______.
a. make European goods more affordable to U.S. residents b. lead to a lower exchange rate for the euro c. make U.S. goods more affordable to European residents d. increase the income of U.S. residents